For 2025 the cost of Medicare part B will be increasing from $174 to $185 per month. This is a 5.9% increase over the previous year. The part B annual deductible will increase by $17 in 2025 to $257. Paying an extra $11 dollars per month adds up to an extra $132 per year. For most retired people, Medicare fees are deducted from their monthly Social Security. For 2025 the Social Security cost of living increase will be 2.5%. The average social security benefit in 2024 was $1,783 per month. A 2.5% cost of living increase will only add $44.58 to the average SS beneficiary’s monthly check. The actual increase will only be $16.58 per month because of the increased Medicare fees and deductible. What the government gives in one hand it takes with the other.
Healthcare costs in the United States are doubling every 12 years. Studies have shown that it costs significantly more for health care in the US than it does in other countries. Health expenditures per person in the U.S. were $12,555 in 2022, which was over $4,000 more than any other high-income nation. For someone who has just entered retirement, escalating healthcare and insurance costs can be an eye-opening experience. After you calculate your monthly expenses, you have to add at least a 6 percent cost of living increase every year of your expected lifespan. My girlfriend, who is currently on Medicare and has not applied for Social Security yet, is having a hard time accepting that monthly Medicare payments are due now and until the end of her life. The latest revelation that Medicare fees will increase every year is another worrisome concern.
She has enough money in her checking account to cover Medicare until she starts receiving Social Security. But her balance is also getting depleted by medical bills and her own undisciplined spending habits. She does not have a monthly spending budget. I think it is difficult to see how much you are to a spending each month if you don’t use a credit card. With a debit card the money comes from your checking account. With a credit card you can pay off your balance each month to avoid interest fees. The credit card bill at the end of the month lets you know if you are within your spending limit or not. I often have to stop using my credit card until the next month. This forces me to stay on budget. You can’t cheat and say I’ll just spend less next month, because that most likely won’t happen.